More Bad Economic Signs for South Florida

August 12, 2010 Leave a comment

For signs that the local economy will remain stagnant.  Also, you may have seen reports that China has slowed its imports–this hurts Latin American, Miami and commodity prices, as well as the US exporters. Not good signs for Coral Gables and not a good time to raise property taxes.

…for the past 10 weeks, the number of homes for sale — crucial in the supply-demand seesaw that determines real estate prices — has been inching upward, sparking questions about the state of the housing recovery and the effect of foreclosures on the marketplace.

The 4.6 percent increase of homes for sale in South Florida since May 31 represents the first two-month rise since the housing bubble burst, recently released data…

via Housing supply on the rise in South Florida – Real Estate News – MiamiHerald.com.

Filed under Business and Commerce, Coral Gables, Economy, Property Values, Taxes and Fees

Coral Gables Taxes and Staffing: Much More to Do

July 29, 2010 Leave a comment

Take a look at the last few pages of the 2010-2011 Budget Estimate where there is some historical information.

Some salient facts there are

  • Property values increased 2.44 times in the period 2000 to 2009.
  • Property taxes increased 2.25 times from 2000 to 2009.
  • In the period 2000 to 2006 (during the most rapid property value increases), property values increased 1.93 times.
  • In the period 2000 to 2006, property taxes have increased 2.19 times.
  • In the period 2000 to 2006 total staff in Coral Gables declined as follows:  871 ( 2006), 875 (2007), 868 (2008), 808 (2009) and  791 (estimated 2010).

In short, on average, property taxes have followed assessed values in Coral Gables since the year 2000.  Rapid increases in property values were used by the city to raise taxes and increase staffing and spending as if this phenomenon was to continue without limit.  And following the stagnation and decline in property values, the city has increased taxes faster that assessed values.

The city has reduced the number of staff, but many of them are at the lowest  grade salary levels. Operating expenses, closely capturing staff salary and benefit expenses, have remained stable at $131.3 million (2007), $136.0 million (2008), $132.0 million (2009), and are expected to decline to $127.7 million (estimated budget 2010).

The number of staff has been reduced by 9.6% but the city’s operating expenses only fell by 3.1%.

This indicates that a much greater effort is needed to increase city efficiencies and reduce salary and pension costs.  When will the Commission get around to do this–this doesn’t seem to be the year.

Filed under Budget, Coral Gables, Finance, Property Values, Taxes and Fees

True Cost of Biltmore Not Paying its Back Rent

July 28, 2010 Leave a comment

I am struck by one of the proposals of the city manager, who indicated that if the City Commission wanted to adopt a millage rate of 5.895 compared to the proposed rate of 6.072,  $1,990,000 revenues would be lost.  We note that the Biltmore Hotel is stated in the budget to have refused to pay rent for $1,910,000. ( I understand a temporary agreement on this might have been reached.)

Therefore, we see what it would cost the city taxpayer’s to have to pay for the Biltmore.

On page ix of the Estimate Budget the following items are lost by the city:  reduce cultural funding, $75,000; reduce funding for 7 police officers and 1 civilian position, $560,000; reduce city paid health insurance, $685,000; reduce 2 firefighter positions, $145,000; reduce police overtime, $300,000; and reduce 2 workdays through furloughing, $225,000.

This is $1,990,000 and shows the cost to the city and taxpayers of Biltmore’s failure to pay–about 7 police officers, cut health insurance, lose 2 firefighters, cut police overtime and furloughing staff and cutting cultural spending. This the same tax reduction that would be lost by our citizens.  It is worth it for taxpayers and residents to suffer these cuts for the Biltmore?  I think not.

Filed under Budget, Finance, Property Values, Taxes and Fees

Coral Gables Budget: Tax Time Again

July 26, 2010 1 Comment

The new budget requires another increase in taxes.  Be cognizant that the increase is truly what economists call “real” increases because there is no inflation–these increases, however small or large, are real dollars coming out of your pocket.

Last year’s tax rate was 5.895 per thousand of property values.  The so-called rolled-back rate is 6.189. This is the rate that keeps the city’s property tax revenues the same as last year–in essence the concern is with the “well being” of the city rather that the impact on the citizen.  [Maybe we should call the rate a “rolled-forward rate” since it is higher than the last rate].

The Budget estimate requires a tax rate of 6.072 millage rate.  This is the rate that a simple majority of the Commissioners can approve, without the usual recent past dissenters of Messrs. Cabrera and Kerdyk, who might certainly force the lower so-called TRIM rate of 6.072 or a 3% increase assuming that one’s property value is the same as last year.  Let’s see what happens in coming weeks, but certainly the plan is for everyone to pay more taxes here in Coral Gables and in Miami-Dade county.

Filed under Coral Gables, Finance, Property Values, Taxes and Fees

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